World climate talks edged towards a compromise agreement today, with delegates trying to agree a form of words on carbon cuts that satisfies both Europe and the US.

Officials said good progress had been made on almost all sections of the so-called Bali roadmap, though a deadlock remained on whether industrial countries should pledge to cut carbon pollution by 25-40% up to 2020.

Britain and Europe support the target but the US wants it removed. The dispute must be settled by tonight for countries to agree the roadmap, which is needed to frame a new global deal on carbon limits.

The German environment minister, Sigmar Gabriel, said he was sure a deal could be reached.

"I think the situation is good and the climate in the climate conference is good, and we will have success in the end," Gabriel said, without going into specifics of the talks.

The environment secretary, Hilary Benn, told the BBC's Today programme that the British delegation was "negotiating hard".

"The real negotiations only got under way yesterday evening. Once people start talking about the detail then you have the potential to make progress. We are going to go on for a few more hours but nobody is under any illusions about the importance of the task that we've got."

He stressed the need for a successor to the Kyoto protocol. "Because the science is very, very clear and what we are doing currently is way short of what is needed to prevent dangerous climate change," he said.

Rachmat Witoelar, Indonesia's environment minister, proposed a compromise dropping specific 2020 targets but reaffirming that emissions should be reduced at least by half by 2050.

Yvo de Boer, the head of the UN climate secretariat, said ministers were trying to agree language that based the roadmap on the scientific findings of the Intergovernmental Panel on Climate Change. Europe says the IPCC supports the 25-40% by 2020 range; the US argues that is one of several possible scenarios.

Publicly, the Europeans stuck with their position. "We continue to insist on including a reference to indicating an emissions reductions range," said the EU environment commissioner, Stavros Dimas.

But Witoelar's proposal gave the two sides room to work out the long-expected compromise, producing a relatively vague mandate for two years of negotiations.

Earlier, the UN's De Boer said he remained "still very concerned about the pace of things". But he struck an optimistic note, saying: "I think everyone is working toward a result."